Grant cuts for electric and hybrid vehicles
Friday 12 October 2018
DR JONATHAN Owens, Lecturer in Operations Management at the University of Salford Business School, comments on the news that Government will be cutting grants for new plug-in hybrid and electric cars.
Dr Owens said: “Today’s announcement is unexpected. Particularly as there is a very real possibility that the ban on sales of new petrol and diesel cars could be bought forward to 2030, in order to bring the UK in line with the rest of Europe. Also, this may be seen as conflicting with the Prime Minister’s announcement last month to add an extra £106m funding to push green vehicles.
“The sale of Electric Vehicles (EV’s) makes up just over 4% of new vehicle registrations in the UK. The UK is currently seen as the European centre for EVs but this is fundamentally because of Government incentives for carmakers to invest in production capacity. However, a lack of costly infrastructure has held back development. This could be the real clue as to where the new money is being diverted. After all, when the UK Government launched the scheme back in 2011 to assist with the cost of buying EV’s it was always clear that the scheme would remain in place until March of this year. It was extended by eight months, so this move has always been on the cards.
“It is expected that growth in EV sales will continue as prices fall. As more EV’s become available from different manufacturers, creating a more competitive market, coupled with the price of lithium-ion battery packs falling it is anticipated that by 2040 EV’s will have around 54% of the market, compared to just over 4% today.
“At the moment the biggest barrier for EV growth in the UK is the number of public charging points. The preferred charging point by a mobile EV user is one that can charge a car to 80% in 10 to 15 minutes, and these are still startlingly few and predominantly on motorway services. Even on the motorway services there may only be one or two chargers. In 2016 Nissan claimed that by 2020 EV charge points would outnumber petrol stations. This may still happen, but it might not provide the important and expected service levels the new EV user will expect.
“Finally, the Department for Transport (DfT) said that the plug-in car grant introduced in 2011 was to assist the UK EV market to become established. With sales of EV doubling in the UK in a little over twelve months, perhaps it could be argued establishment of this market is building. But this market will need a much improved infrastructure than we currently have and perhaps this is the next challenge for the UK’s ‘Road to Zero’.”